Customer Bargaining in Retail Settings: Employee Perspectives
Bartering, bargaining, and haggling have long been a mainstream practice in many cultures and for certain retail segments such as car, furniture, and electronic retailers. The phenomena have been studied in the context of economics and game theory, busine
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sion making (Honold 1997; Vogt and Murrel 1990), can affect how comfortable employees are with handling bargaining requests. Our interviews revealed that many companies empower their employees to handle bargaining requests, however, not all employees are comfortable engaging in these empowerment behaviors due to personal and/or organizational characteristics. Therefore, as the employee’s comfort with empowerment in general increases, so should their comfort with handling bargain requests. H2a: As employees’ comfort level with empowerment increases, comfort with handling customer bargaining requests increases. When customers engage in bargaining behavior, we find instances of role ambiguity resulting because the employee is uncertain about their role as a salesperson. Traditionally, the role of the front line employee is to provide customers with knowledge about a product and to sell the product to the customer for the price posted. When the customer bargains with the employee, s/he is requesting that the employee act outside of their normal capacity by setting new prices for products. Thus, the bargaining event may cause role ambiguity for the employee over his/her role, which may decrease how comfortable s/he feels with the bargaining request. H2b: As employees’ role ambiguity increases, comfort with handling customer bargaining requests decreases The depth interviews also revealed that the front-line employee may experience negative affect, or feelings, associated with customer bargaining. When employees are uncomfortable accommodating the customer’s request, they may experience negative affect because they may find the experience unpleasant or distressing. H3: As employees’ comfort with handling customer bargaining requests increases, employee negative affect decreases. In addition to the impact of the employee’s comfort with handling bargaining requests may have on affect, the customer themselves may impact the employee’s affect. First, our interviews reveal that when customers approach the employee in calm and unassertive manner, the employee is more likely to listen to and understand the customer’s request, however when the customer is dominant, or approaches the front line employee in an assertive manner, the employee may refuse to accommodate the customer and have negative feelings as a result. Thus, we propose that as the customer’s dominance increases, the employee’s negative affect will increase. H4a: As customer dominance increases, employee negative affect increases. Our interviews also revealed that how reasonable the customer’s request seems to the employee and how the customer handles him/herself after the employee tells the customer whether s/he can accommodate the request may also influence employee negative affect. For example, in the interviews, when the customer had what the employee felt was an unreasonable request, such as simply wanting a discount with no reason provided, the employee reported more negative feelings associated with the encounter, perhaps because s/he felt “put on the spot” by
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